Rosneft signs long-term oil supply deal with BP

Rosneft has agreed to supply BP with up to 12 million tons of oil and oil products over 5 years. The deal assumes a prepayment of at least $1.5 billion, and comes despite political rhetoric of more western sanctions against Russia.

“At the moment of
signing, the deal prepayment has made of around $2 billion. Eight
leading world banks participated in the deal. The prepayment sum
will be increased, because several more banks said they are
interested in the deal,” ITAR-TASS quotes a representative
of the Russian oil major.

Deliveries on the contract may begin this July while the price
will be calculated with a similar formula Rosneft uses in the
sale of oil products and oil at regular annual tenders.

It’s a second major agreement between Rosneft and BP since the
sanctions were imposed on the Russian
company's CEO Igor Sechin, a close friend of Vladimir Putin.
However, BP CEO Bob Dudley said he was mostly interested in
keeping his business going and didn’t care about personal
sanctions.

"I am working here with Rosneft. It’s business between the
companies. I don't comment on personal sanctions," Dudley
told reporters in Khabarovsk on Friday.

The deal opens up new possibilities for both companies. For BP it
guarantees the quality of oil products and ensures stable
supplies, while Rosneft maintains high profitability and gains
additional financial resources, ITAR-TASS cites Rosneft’s chief
executive Igor Sechin.

The signing follows May's BP and Rosneft agreement to jointly
explore for "tight" oil in Russia.